Global Financial Integrity

 

On Sixth Annual International Anti-Corruption Day, GFI Weights Victories, Losses in 2009

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Monique Perry Danziger, +1 202 293 0740 ext. 222

WASHINGTON, DC — Today, as countries around the world observe International Anti-Corruption Day, Washington, DC-based research and advocacy organization Global Financial Integrity (GFI) notes the following victories and defeats from the past year in the fight against international corruption:

The Good:

  • Foreign Corrupt Practices Act (FCPA): 2009 sees a continued increase in investigations conducted and cases brought under the 30+ year-old FCPA. At present, there are an estimated 120 pending FCPA investigations.
    • The uptick in FCPA cases is due to such factors as the increased involvement of U.S. companies in countries like resource-rich, but corruption-heavy countries like Nigeria; the Patriot Act of 2001 which linked bribery of foreign officials to the advancement of terrorist activity; and the Sarbanes-Oxley Act of 2002, which made senior executives of public companies accountable for the criminal activities of their companies.
  • Key Anti-Corruption Legislation Introduced: September of this year, Senator Richard Lugar introduces S. 1700: The Energy Security Through Transparency Act which would require certain issuers to disclose payments to foreign governments for the commercial development of oil, natural gas, and minerals, to express the sense of Congress that the President should disclose any payment relating to the commercial development of oil, natural gas, and minerals on Federal land, and for other purposes.
    • Hailed by supporters as a key resource for deterring government corruption and ensuring resource-rich countries are able to benefit from extractive industries commerce conducted within their borders.
  • Congressional Action on Corruption: May of this year the House Financial Services Committee holds a hearing on official corruption, its impact on developing countries, and the role of Western financial institutions, prefacing efforts to craft new legislation to tackle corruption in developing countries.
    • Ranking Member Spencer Bachus states the intent of his committee to “put Africa front and center” and examine the “interconnectivity of emerging economies and Western economies,” in recognition of the fact that “corruption effects us all.”
  • Multilateral, International Pledge to Combat Corruption: Group of 20 affirms its commitment to pressing uncooperative secrecy jurisdictions to adopt more rigorous reporting standards, tackle banking secrecy, and increase overall transparency in global finance in a communiqué released at the conclusion of today’s summit in Pittsburgh.

The Bad:

  • U.S. Doors Still Open to Corrupt Persons: November of this year the New York Times reports that Teodoro Nguema Obiang, the forest and agriculture minister of Equatorial Guinea, whom federal law enforcement officials believe “most if not all” of his wealth comes from corruption remains free to obtain U.S. entry visas and visit his $35 Malibu, CA estate despite a federal law and a presidential proclamation that prohibit corrupt foreign officials and their families from receiving American visas.
  • Toothless UN Anti-Corruption Plan: Meeting in Doha Novemebr of this year, UN officials nearly failed to reach consensus on the long-awaited review and enforcement mechanism missing from the UN Convention Against Corruption (UNCAC). After much debate, a review mechanism relying heavily on voluntary compliance and requiring little or no public disclosure of reports emerged.
  • Ill Gotten Gains Case Goes Cold: October of this year, Transparency International’s potentially ground-breaking case against presidents of Gabon, Congo-Brazzaville, and Equatorial Guinea regarding millions of dollars in embezzled funds ostensibly used to make big-ticket purchases in France is thrown out of French court.
    • Estimates of corruption vary, but TI cited one estimate that $100 to $180 billion has been stolen by corrupt dictators in the last few decades.

“Global corruption exists today, despite numerous and vociferous declarations of intolerance from countries, because banking secrecy and complicit Western financial centers allow it to,” said GFI director Raymond Baker. “Enacting better laws and strengthening enforcement of existing anti-corruption protocols is important, but we must also pursue actions to increase transparency and accountability in the global financial system.”